Carolina Home Builders, Inc. v. Armstrong Furnace Co., 19494

• Decision Date: 03 October 1972
• Docket Number: No. 19494,19494
• Citation: 259 S.C. 346,191 S.E.2d 774
• Court: South Carolina Supreme Court
• Parties: CAROLINA HOME BUILDERS, INC., Respondent, v. ARMSTRONG FURNACE COMPANY, Appellant.

Page 774

191 S.E.2d 774

259 S.C. 346

CAROLINA HOME BUILDERS, INC., Respondent, v. ARMSTRONG FURNACE COMPANY, Appellant.

No. 19494.

Supreme Court of South Carolina.

Oct. 3, 1972.

William Douglas Gray, of Watkins, Vandiver, Kirven, Long & Gable, Anderson, for appellant.

Karl L. Kenyon, of Anderson, Kenyon & Epps, Anderson, for respondent.

BRAILSFORD, Justice:

In the fall of 1968, Carolina Home Builders, Incorporated, purchased from a Greenville distributor, Sun Heating Company, heating and cooling equipment for use in an apartment complex under construction by it in anderson. The equipment, consisting of twenty-four identical electric furnaces and like numbers of identical condensers and evaporators, was selected and ordered by Carolina from a variety of models described in the specification sheet and price list of the defendant, Armstrong Furnace Company, whose products Sun Heating distributed. The seventy-two units were shipped from Armstrong's factory in Ohio to Sun Heating in Greenville. Mechanics employed by Carolina installed a furnace and an evaporator in an upstairs closet in each of twenty-four new apartments, the condensers being installed elsewhere.

The twenty-four heating and cooling systems were identical in operation. A single fan, housed in the furnace, served both the furnace and the evaporator. To accommodate this dual function, the furnace was mounted directly atop the evaporator in the closet. When used as part of the air conditioning system, the fan propelled air downwardly through the evaporator assembly in what is styled as a 'counterflow' or 'downflow' application.

When installation began, it was found that the furnaces did not match the evaporators for mounting purposes. Thereupon, a representative of Sun Heating contrived the needed number of 'transition pieces,' not otherwise described in the record, with the use of which Carolina's mechanics were able to fasten the furnaces into place on the evaporators.

Following installation, a tst of the air conditioning systems revealed that each unit was discharging condensation onto the closet floor beneath the evaporator. Instead of flowing down the aluminum fins of the V-shaped cooling coil inside the evaporator, thence into the drain pan at the base of the coil, much of the condensation forming on the fins during normal operation dropped off the fins and onto the floor.

After consultations between carolina's president, Sun Heating's representative and Armstrong's chief engineer, auxiliary drain pans were finally installed which substantially solved the problem, although their use somewhat reduced the cooling efficiency of the system. By the time the problem was solved, however, aberrant condensation from the units in use by tenants in the rented apartments had caused extensive water damage to floors, ceilings and walls. This action by Carolina against Armstrong and Sun Heating for water damage and loss of rental income attributed to the faulty functioning of the air conditioners followed.

The complaint was in a single count. Preliminarily, it alleged that the heating and cooling equipment had been warranted by Armstrong to be of the highest quality of material and workmanship and to be free of defect, but that the evaporators were defective in that the condensation of water which formed during the cooling operation was not contained by the drip pans and drains designed for that purpose. Instead, the condensation saturated the floors and caused water damage to the buildings, which, in turn, resulted in loss of tenants and rents.

The complaint then alleged that plaintiff's damages were the result of joint and concurrent negligence and willfulness of the defendants, as specified as to Sun Heating in ten sub-paragraphs and as to Armstrong in eight sub-paragraphs. Actual and punitive damages were sought. Armstrong interposed a general denial to the complaint. Sun Heating was dismissed from the action at plaintiff's election prior to the trial, and its answer was not printed.

The jury found a verdict for plaintiff for actual damages, the claim to punitive damages having been withdrawn, and defendant has appealed on numerous exceptions.

The first ground of appeal charges error in the refusal of Armstrong's motion for a directed verdict for lack of any evidence of actionable negligence on its part. Armstrong's chief engineer testified that discharge of condensation from the fins, short of its intended destination in the drain pan, was the inevitable result of the use of this model evaporator in conjunction with the electric furnace, a purpose for which, he testified, it was not designed. Even at minimum speed, the furnace fan supplies a volume of air to the evaporator considerably in excess of that which it is designed to accommodate. The excessive velocity of the resulting airflow was assigned by this witness as the main cause of improper condensation discharge, described as 'blow-off.' His testimony at the trial was Carolina's first notice of Armstrong's claim that the units were mismatched.

If Armstrong in fact marketed the furnace and evaporator models in question for use in combination, we think it reasonable to conclude that it was negligent in failing to design the evaporator to accommodate the volume of air supplied to it by the furnace fan, and in failing to discover this defect by ordinary testing. The specification sheet and price list furnished by Armstrong to Sun Heating, and used to select the equipment, were placed in evidence. The price list specifies the use of cooling equipment of two tons capacity in combination with the electric furnace. The evaporator model chosen met that requirement. Beneath a picture of the electric furnace the price list declares: 'OUR STANDARD COOLING IS APPLICABLE ON THIS SERIES.' The specification sheet, used in conjunction with the price list, contains a 'Furnace and Evaporator Application Chart.' In the case of oil and gas furnaces, the chart specifies the evaporator models whose cabinets 'match' each furnace, and also designates those evaporators which are 'not recommended for use with furnace.' Although the chart indicates that the cabinet of an evaporator model larger than the one purchased by respondent matches the electric furnace for counterflow application, it fails to advise against the use of any particular models, as is done with the other furnaces. Additionally, various 'transition kits' are recommended for use in adapting certain evaporators to match various oil and gas furnaces, thus implying that a mismatch between furnace and evaporator cabinet does not necessarily preclude their use in combination.

When Armstrong undertook to distribute information designating satisfactory combinations of equipment, upon which purchasers were intended to rely in selection, it assumed the duty to use care in assuring an appropriate choice. Assuming, as Armstrong claims, that the furnace and evaporator models purchased by respondent were not designed for use together, the jury could reasonably conclude that Armstrong inadequately informed the buying public of that fact. Moreover, when Armstrong received a single order from Sun Heating for twenty-four furnaces, condensers and evaporators, it was surely on notice that use of the units in combination was contemplated. The jury could reasonably conclude that filling this order without inquiry or warning amounted to negligently marketing the mismatched units for such use.

An additional ground of defendant's motion for a directed verdict was based upon the absence of privity of contract between Carolina and Armstrong. In assigning as error the refusal of the circuit court to sustain this ground, Armstrong's reliance is upon the discredited doctrine of Winterbottom v. Wright, 10 Mees & W 109, 152 English Reprint 402 (1842), and its progeny, proscribing a negligence action against the manufacturer of a defective product in the absence of privity of contract between the defendant and the injured party. The so-called general rule of non-liability resulted in hardship, and the courts were astute in fashioning exceptions by which, after many years, it has been subverted. Much has been written by judges and law writers about this assault upon the citadel of privity, which need not be expounded here. ¹ In joining the unmistakable thrust of modern authority by...